Can I access my super at 60 and still work?

JACQUELINE BELESKY
Sub Editor · 9 March 2021
Accessing your super and continuing to work can be like having your cake and eating it too – here’s a guide to how it works and the rules that can apply from age 60.

Generally speaking, you can only access your super as a lump sum after turning 60 if you meet a condition of release, such as retiring from the workforce, leaving a job or waiting until you turn 65. However, even if you are still gainfully employed at age 60, there are still some ways you may be able to start accessing the money in your super.

In this article, we cover:

Can I access super at 60 and still work?

You can access your super as a lump sum at 60 if you choose to retire, based on the legal definition of the term. Under the Superannuation Industry (Supervision) Regulations 1994, retirement at or after age 60 simply requires you to end an arrangement under which you’re gainfully employed. If you have more than one job, this means that after you’ve turned 60, you may be able to resign from one of them and keep working in the other job(s). Ending one employment arrangement might mean you meet a condition of release for your super. If you have only one job, you can typically cease your current employment arrangement and begin another one if you want to, with no minimum time in between.

If you aren’t working when you turn 60, you may still meet the ‘retirement’ criteria if the super fund trustee is ‘reasonably satisfied’ that you intend never to again become gainfully employed, either on a full-time or a part-time basis. Alternatively, if you have reached your preservation age, which is currently a maximum of 60 years old, this means you may start accessing some of your super via a transition to retirement income stream, even if you don’t retire or quit one of your jobs.  We go into some more detail about each of these options below.

What is retirement?

Under Australian legislation, if a person has reached their preservation age and it’s less than 60, they are considered to have retired only if they leave an arrangement of ‘gainful employment’ and their super fund is ‘reasonably satisfied’ that they never plan to return to the workforce. For a person who is 60, the criteria for retirement are more lenient, in that a person can be considered ‘retired’ once they end a ‘gainful employment’ arrangement, so long as they either never intend to go back to the workforce or left the arrangement after turning 60.

older couple retired
Australian legislation explains how ‘retirement’ is defined for superannuation entitlements. Image source: fizkes/Shutterstock.com

What is gainful employment?

According to the Australian Taxation Office (ATO), ‘gainfully employed‘ means being employed or self-employed for gain or reward in any business, trade, profession, vocation, calling, occupation or employment. You do need to receive some form of monetary or other payment – not just a reimbursement for voluntary work – but the amount of the payment, the level of effort involved and whether it results in a profit or loss is irrelevant. You can be gainfully employed either part-time or full-time.

How can I access super if I’m eligible at 60?

Even if you aren’t eligible to access your super as a lump sum at 60 based on the ATO’s requirements, you may be able to use an account-based pension (also known as an income stream or allocated pension). Financial regulator ASIC explains that this pension is a regular income from your super that is tax-free for those aged 60 and over. 

For APRA-regulated super funds, the ATO advises that super funds can pay benefits as a ‘super income stream’ if a condition of release, such as retiring at 60, is met. A super income stream (also known as a super pension or annuity) is a series of periodic payments to a member that can be either account-based or non-account-based, as a minimum payment that occurs at least annually. The ATO says that if you do meet another condition of release such as leaving a paid job, retiring or turning 65, another option for you may be a lump sum withdrawal.

Source: ATO.

According to the ATO, meeting certain conditions of release, including the retirement condition of release, means that your superannuation savings up to this point will become ‘unrestricted non-preserved’ benefits. This means you can withdraw some or all of your savings as an income stream or lump sum, but you don’t have to. You can leave it in your superannuation funds, continuing to grow, for as long as you want.

If you keep working, keep in mind any super benefit you accrue from this point from a new (or continuing) employment arrangement will likely be treated as a ‘preserved benefit’, meaning it can’t be accessed until you satisfy another condition of release that applies to that benefit.

Whether you access your superannuation sooner or later, it’s important that you’re with a fund that supports you to make the most of your savings. You can compare funds with Canstar to find a fund that may meet your needs.

What are the tax implications of accessing super at 60?

Generally speaking, the ATO advises that both lump sum and income stream withdrawals from superannuation are usually tax-free once you turn 60 and meet a condition of release, but it does depend on the nature of your super fund. Keep in mind that if you access your super preemptively without meeting a condition of release, the ATO says the entire amount of your super benefit will be taxable regardless of whether it has a tax-free component. It may be a good idea to seek professional financial advice, including taxation advice, to support you in planning to access and use your super effectively for retirement. 

What age can I access super if I don’t retire?

You can access your super once you turn 65, even if you haven’t retired, according to the ATO. Canstar has a related article about superannuation rules for over 65s that you may like to read. Whether you want to access your super in the form of a lump sum withdrawal or as pension income payments, you can do so whenever you like after reaching the age of 65.

Whether you’re close to the point at which you can access your super or just starting to make contributions to your future retirement benefit, it can be helpful to stay engaged with what’s happening to your retirement savings. Canstar considers factors such as investment performance, fees, insurance premiums and other product features across superannuation products on our database for our Superannuation Star Ratings and Awards. You can discover which funds have 5-Star-Rated products with Canstar.

Image source: Nataliya Arzamasova/Shutterstock.com

Additional reporting by James Hurwood. This article was reviewed by our Sub Editor Tom Letts before it was published, as part of our fact-checking process.


About the author:

Jacqueline-Belesky

Jacqueline Belesky is a Sub Editor at Canstar. She brings over 15 years of experience in corporate communications, media and publishing and holds a Bachelor of Journalism (Distinction) from Queensland University of Technology and postgraduate qualifications in Writing, Editing and Publishing from the University of Queensland. Jacqui was previously a Global Content and Media Manager for ABB in the UK and in Oslo, Norway, and has worked in Australia as a journalist for News Corp and editor for the Queensland Government, John Wiley & Sons and the University of Queensland. Jacqui’s articles have been published in The Courier-Mail, The Gold Coast Bulletin and on www.news.com.au. She also brings experience managing the editorial production of annual reports, financial statements, research papers and supplements on topics such as business sustainability and the global financial crisis. You can follow Jacqui on LinkedIn and Twitter.


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